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THE MONTHLY REVIEW Of Agricultural, Industrial, Trade, and Financial Conditions in the Tenth Federal Reserve District FEDERAL Vol. 21 RESERVE BANK OF KANSAS CITY KANSAS CITY, MISSOURI, AUGUST 2.9, 1936 CONTINUATION of drought conditions which had prevailed generally in the District since the middle of June materially reduced crop prospects during July and the forepart of August. The extremely hot, dry weather arrived too late to affect seriously the production of winter wheat, but the corn crop is practically a failure so far as grain production is concerned and other crops have suffered extensively. Irrigated crops, however, had ample water supplies this year and were in good condition. The indicated production of feed grains was substantially below normal, but the live stock feed situation was somewhat less serious than in 1934 owing to an increase in grain and hay supplies and a reduction in live stock numbers compared to two years ago. Ranges and pastures were short and stock water was very low in many areas. Plowing for fall seedings has been delayed because of the hard, dry soil. Marketings of grains and live stock generally increased during July but receipts of corn declined as producers withheld supplies because of the uncertainty regarding the new crop. The July movement of wheat was the largest since 1931. Drought was a factor in increased receipts of hogs although supplies were substantially below normal. Grain and feed prices advanced sharply in July and August because of crop deterioration. Hog prices were at the highest level for July since 1929 and lambs since 1930 but cattle values were somewhat below a year ago. Retail trade at thirty-one department stores showed the usual seasonal decline in July, while wholesale trade showed a slight improvement. Department store sales were 5.5 and wholesalers, sales 9.6 per cent greater than in July, 1935. Lumber sales and building activity increased. The volume of payments by check was 11.6 per cent greater than in June and 27.4 per cent greater than a year ago. The production of flour, crude petroleum, and bituminous coal increased during July and was above that in July, 1935. The production of flour and petroleum was at a high level. Shipments of lead ore increased but shipments of zinc ore declined. Packers' purchases of live stock indicated a general increase in meat packing operations in July, with the slaughter of cattle, calves, and hogs greater than a year ago, although hog slaughter was considerably below normal. A Member Bank Operations Loans and discounts of fifty-two reporting member banks in the Tenth District, after showing little change in June, increased 6.9 per cent between July 8 and August 5 to a Jevel 18.8 per cent above that of August 7, 1935, reflecting principally an increase in commercial loans both during the four-week period and during the year. Investments increased further during the four weeks and on August 5 were 15 per cent greater than a year ago, the major part of these increases occurring in holdings of No. 9 BUSINESS IN THE TENTH FEDERAL RESERVE DISTRICT In Percentages of Increase or Decrease 7 Months 1936 July 1936 compared to compared to Banking June 1936 July 1935 7 Months 1935 Payments by check, 29 cities.................. +u.6 +27.4 +1 3.9 Federal Reserve Bank check collections -13.7 +16.1 +13.5 - 6.6 Business failures, number........................ -10.7 -28.6 Business failures, liabilitie:...................... +90.7 -65.0 +19.2 Loans, 52 member banks·-- -··················· + 6.9 +18.8 Investments, 52 member banks.............. + 3.5 +15.0 Adjusted dem. deps., 52 member banks + 3.3 +10.5 Time deposits, 52 member banks·-·-·-··· - 0.2 - 0.4 Savings deposits, 45 selected banks·--·- + 0.5 + 2.6 Savings accounts, 45 selected banks __ .. + 1.4 + 2.3 Distribution +10.4 Wholesalers' sales, 5 lines combined ...... + 2.2 + 9.6 + 9.2 Retailers' sales, 31 department stores._. -22.5 + 5.5 +36.6 + 2.7 L~m?er sales, 158_ retail yards .............. _ +u.7 - 2.1 +10.1 Life insurance, written·---······················· - 1.9 Construction Bu.ilding contracts awarded, value. __ ... + 8.6 +76.9 +199.2 +66.o + 6.1 Residential contracts awarded, value... . -l9.3 +63.2 Building permits in 18 cities, value....... . +26.3 -5-1 Production + 0.2 +22.4 Flour. -················----·················· +22.0 Crude petroleu •..__ _ _ __ + 3.0 +u.7 +7-5 +17.0 Soft coal .................................................... . +14.8 + 25.3 -II.2 +28.4 Zinc ore (shipped) Tri-State district..... . -18.7 +46.2 Lead ore (shipped) Tri-State district... . +19.1 +4o.9 Grain receipts, 5 markets +112.3 +139.4 Whea.___ _ _ _ _ _ ······················ +331.7 +51.2 +143.3 -33.7 Corn ..._ · ------·························· Oat.,__ _ _ _ _ _ __ +142.7 +444.5 +149.6 +20.8 +28.3 +14.4 + 19•7 +43• 1 +27.6 +24.8 +75.:2 - 8.3 - 3.9 + 6.o -7-9 +25.5 +14.0 +28.7 + 9.2 + 2.9 +21.7 +23.6 +88.4 -13.6 +17.6 - 3.0 +28.6 - 8.7 +67.6 +27.2 +33.7 +75.9 -10.5 -38.0 +25.6 +3o.5 +49.8 - 23.5 +26.5 Live stock receipts, 6 markets Cattle................·-······-····················.......... . Calve.,___ _ _ _ _ ·······················Hogs.......................................... _............. -Sheeo....·-··----···························· Hors.es and mules ................................ ·-··· Meat pacldng, 6 markets Cattle...................................... _ _ __ Calves·--······· .............................................. Hogs ..................... ...................................... . Sheep ......................................................... . Stocker and feeder shipments, 4 markets Cattle......................................................... . Calves·-····················· ................................ Hogs........................................................... . Sheep .......................................................... +48.0 -5-4 -:23.5 United States Government direct and guaranteed obligations. Reserve balances of these reporting member ban1'.s showed a further increase from July 8 to August 5 when reserves were 22.5 per cent larger than one year earlier. Adjusted demand deposits reached a high level for the year on July 15 but subsequently declined slightly, recording an increase of 3.3 per cent for the four weeks ended August 5 and of 10.5 per cent for the year. Balances held for domestic banks, which had shown a substantial increase in the latter part of This Copy Released For Publication In Morning Newspapers, August 29. THE MONTHLY REVIEW June and the first week of July, increased further between July 8 and August 5 to a level 32 per cent above that on August 7, 1935. Time deposits showed little change during the four weeks and during the year. The principal resource and liability items of the consolidated weekly condition statements of the fifty-two reporting banks, for the three dates of comparison: Loans and investments-total.. Loans and discounts-totaL __ Secured by stocks and bonds All other loans and discounts lnvestments-tota U. S. securities direcL .......- .• Obligations fully guaranteed by the U.S. Government.. Other securities·-····················· Reserve with F. R. Bank.......... Demand deposits-adjusted ...... Ttmc deposits.·-··················· ....... U. S. Government deposits........ Inter-bank deposits: Domestic banks·- -- ·········........ Foreign banks .......................... Aug. 5, 1936 '$703,372,000 242,215,000 51,388,000 190,827,000 461,157,000 270,564,000 56,088,000 134,505,000 128,443,000 473,5°3,000 146,083,000 22,772,000 429,425,000 159,000 July 8, 1936 '1,672,229,000 226,654,000 49,612,000 177,042,000 Aug. 7, 1935 '1,604,874,000 203,941,000 47,0 53,000 445,575,000 56,888,000 4oo,933,ooo 264,413,000 232,955,000 l 23,056,000 45,123,000 122,855,000 104,880,000 428,703,000 146,707,000 11,6o8,ooo 414,94 1,000 168,000 325,398,ooo 114,000 47,756,ooo 133,406,000 124,069,000 458,480,000 146,313,000 Reserve Bank Operations Holdings of bills discounted for member banks, which had reached a new low level by July 8, and holdings of bills purchased continued in small volume. Industrial advances and commitments to make industrial advances declined between July 8 and August 5 and on that reporting date the total of loans and commitments was below that of a year ago, although there was a slight increase in commitments. Holdings of United States Government securities were unchanged during the four weeks at a level 15.1 per cent above that of August 7, 1935. Federal Reserve note circulation increased to a new high level on August 5 which was I.I per cent above the previous high on July 8 and 22.4 per cent above a year ago. Member banks' reserve deposits reached a new high level of $196,984,233 on July 29, exceeding the previous high of May I 5, 1935, by a slight margin, but subsequently declined in the week ended August 5 to a point 5.2 per cent greater than four weeks earlier and 10.4 per cent greater than on August 7, 1935. The principal resource and liability items of the weekly condition statements of the Federal Reserve Bank of Kansas City and branches, for the three dates of comparison: Aug. 5, 1936 July 8, 1936 '1,242,239,348 Total reserves .....,........................ '1,259,566,943 Bills discounted 87,785 55,591 Bills purchased............................ 87,062 86,592 Industrial advances.................... 897,898 1,006,3II U. S. securities............................ 122,927,000 122,927,000 Total bills and securities............ 124,180,745 124,256,494 Total resources............................ 422,699,879 408,754,700 F. R. notes in circulation.......... 153,704,125 152,086,825 Member banks' reserve deposits 195,477,917 185,890,129 The discount rate of the Federal Reserve Bank of Kansas City, of paper and all maturities, remained unchanged at 2 per cent. Aug. 7, 1935 '1,202,998,328 112,463 126,566 1,157,131 106,844,200 108,240,360 344,675,965 125,546,625 177,076,509 on all classes Savings Savings deposits at forty-five selected banks in leading cities of the District increased slightly from July I to August I and the number of savings accounts showed a gain of 1.4 per cent. Savings deposits on August I were 2.6 per cent and the number of accounts 2.3 per cent greater than on August 1, 1935. Savings accounts and savings deposits reported by the fortyfive banks: August 1, 1936........................................ July 1, 1936.................................. ........... August 1, 1935.................... .................... Savings Accounts 414,380 408,579 405,000 Savings Deposits 1,127,862,084 127,179,187 124,586,739 Reserve Bank Check Collections The dollar volume of check collections through this bank and branches, which usually increases during July, ~eclined somewhat from the unusually large June total, which had been increased by operations in connection with the payment of checks and adjusted service bonds to veterans, but exceeded the total of a year ago by 16.1 per cent. Check collections for the year to August I increased 13.5 per cent in dollar volume compared to the same period in 1935. Check collections through the Federal Reserve Bank of Kansas City and branches at Omaha, Denver, and Oklahoma City: A MO UNT ITEMS July·-················· June .................. Seven months .. 1936 6,387,366 6,646,134 41,963,138 1936 1935 5,467,895 $1,047,059,000 5,054,843 1,212,872,000 6,508,693,000 36,553,236 1935 1, 902,039,000 833,638,000 5,732,701,000 Bank Debits Debits by banks to individual accounts in twenty-nine reporting cities in the District increased seasonally during the four weeks ended July 29 and were 27.4 per cent greater_ th_an during the corresponding four weeks of last year. This increase was the largest reported this year and raised the cumulative gain for the first thirty weeks of 1936 to 13.9 per cent over the total for the first thirty weeks of 1935. PAYME TS BY CHECK FouR WEEKS ENDED July 29, 1936 July 31, 1935 Albuquerque, N. M ..................... '$ 11,455,000 'I, 9,4 27,000 3,313,000 5,306,000 Atchison, Kans.·--·······-·•··-·········· 21,081,000 Bartlesville, Okla .. -..................... 21,680,000 Casper, Wyo.·-- -······················· -· Cheyenne, Wyo ........................... Colorado Springs, Colo ............... Denver, Colo..... .......................... *Emporia, Kans..- ....................... Enid, Okla................................... Fremont, Nebr..- ......................... Grand Junction, Colo ................. Guthrie, Okla .......................... .... Hutchinson, Kans ....................... Independence, Kans ................... Joplin, Mo ................................... Kansas City, Kans ..................... Kansas City, Mo......................... Lawrence, Kans ........................... Lincoln, Nebr. ............................ Muskogee, Okla ........................... Oklahoma City, Okla ... ............. Okmulgee, Okla ........................... Omaha, Nebr............................... Pittsburg, Kans ........................... Pueblo, Colo ..- ............................. Salina, Kans ................................. St. Joseph, Mo ............................. Topeka, Kans ........................... ... Tulsa, Okla..-............................... Wichita, Kans ..... ........................ 5,384,ooo 4,104,000 6,780,000 14,329,000 139,867,000 3,869,000 15,387,000 2,640,000 3,060,000 6,773,ooo 10,996,000 122,174,000 23,6o6,ooo 2,694,000 14,035,000 2,013,000 2,088,000 1,560,000 16,606,000 2,162,000 8,574,000 7,130,000 14,085,000 337,738,000 3,836,000 10,543,000 252,564,000 2,783,000 22,828,000 1,605,000 27,356,000 8,031,000 88,271,000 2,491,000 161,826,000 3,728,000 2,290,000 u8,478,ooo 2,836,000 15,978,000 II,370,000 18,724,000 9,229,000 22,816,000 31,625,000 19,623,000 118,776,000 55,654,000 6,453,ooo 75,218,000 15,796,000 95,ou,000 46,781,000 Total 29 cities, 4 weeks .......... 1, 1, 170,109,000 '/, 918,458,000 Total 29 cities, 30 weeks .......... 7,588,639,000 6,664,353,000 U. S. 273 cities, 4 weeks.......... 33, 01 7,539,ooo 30,363,451,000 U. S. 273 cities, 30 weeks .......... 260, I 51,.305,000 22 7,824,678,000 *Not included in totals. Per cent Change +21.5 +60.2 + 2.8 +31.2 + O.l +3°-3 + 14·5 + 9.6 +31.1 +46.6 + 2.9 +42.2 +24.6 +20.3 +33.6 +33.7 +37.8 +19.8 + 24.5 +17.4 + 8.S +36.6 +31.5 +4o.5 +102.9 +38.6 +24.2 +25.0 +19.0 + 27.4 + 13.9 + 8.7 +14.2 Business Failures Commercial failures in the Tenth District during July were at low levels for the month. There were ten fewer failures than in July, 1935, and the amount of liabilities involved was about one-third of that a year ago. Liabilities, however, showed an increase durin3 the first seven months of 1936 as compared to the first seven months of 1935 because of increases in January and March of this year. THE MONTHLY REVIEW Stores ReportinO'0 Kansas City ...... .. 4 Denver.................. 4 Oklahoma City.... 3 Tulsa.................... 3 Wichita................ 3 Other cities .......... 14 3 RETAIL TRADE AT 31 DEPARTMENT STORES IN THE TENTH FEDERAL RESERVE DISTRICT In Percentages of Increase or Decrease except Rate of Turnover AMOUNTS COLLECTED SALES STOCKS (RETAIL) ACCOUNTS RECEIVABLE July 1936 Year 1936 July 31, 1936 STOCK TURNOVER July 31, 1936 July 1936 compared to compared to compared to compared to July Year compared to July 1935 Year 1935 June 30,1936 July 31,1935 1936 1935 1936 1935 June 30, 1936 July 31, 1935 June 1936 July 1935 -16.9 +12.8 I.O + 8.I - 8.2 +u.7 .24 .26 2.15 l.92 -19.8 + 6.1 + 2.5 +10.4 +12.5 +12.0 + 1.9 +14.9 .29 .28 2.12 2.02 -10.2 + 6.3 - 6.9 + 9.6 - 0.5 + 9.2 - 9.0 + 3.7 .29 .30 2.47 2.37 - 9.3 +10.6 +12.5 +10.7 -11.3 + 6.1 .33 .32 2.51 2.42 -10.4 + 6.o - 8.7 +15-2 Even + 7.8 + 2.6 + 5.6 -12.0 - 9.1 .24 .20 1.97 1.88 -14.3 - 0.3 -IO.I +12.3 + J.9 + 7.9 - 9.I + J.9 .22 .21 1.80 l.67 -II.4 + 2.I Total._ __ ··········· ... 31 + 5.5 + 9.2 - 5.9 + 8.4 .26 .26 2.09 1.96 -12.1 + 5.2 - 6.4 NOTE: Ratio of co llections during month to regular accounts outstanding end of preceding month: July 45.1; June 46.7; July 1935, 43.9. Business failures reported by Dun and Bradstreet, Incorporated: TENTH DISTRICT Number Liabilities July 1936.............................. 25 '/, 185,000 June I 936·--························· 28 97,000 July 1935······························ 35 528,ooo Seven months 1936·---······· 254 3,068,000 Seven months 1935·--··· ..... 272 2,574,000 UNITED STATES Number Liabilities 639 $ 9,904,000 773 9,177,000 902 16,523,000 5,953 97,077,000 10 5,490,000 6,975 Life Insurance Sales of new paid-for ordinary life insurance in the seven states in the District in July were slightly smaller than in June but exceeded sales in July, 1935, by IO.I per cent. Sales for the first seven months of the year were 2.1 per cent below the total for the first seven months of last year. Life insurance sales reported to the Life Insurance Sales Research Bureau by companies representing 90 per cent of the total legal reserve ordinary life insurance outstanding in the United States: Colorado.-.................................... . Kansas .......................................... l\.1issouri ...................................... . Nebraska ..................................... . New Mexico·--···· ....................... . Oklahoma____ ······························· Wyoming................ .................... . Seven states............................... . United States..·--········· ............... July 1936 1, 4,374,000 5,439,000 15,326,000 4,533,000 1,054,000 5,858,000 1,097,000 1, 37,681,000 512,738,000 June 1936 1, 4,9 19,000 4,692,000 16,153,000 5,008,000 858,000 5,998,ooo 790,000 July 1935 ,, 4,274,000 5,55°,000 13,929,000 4,029,000 691,000 4,841,000 912,000 '/, 38,418,000 53 2,994,000 1, 34,226,000 483,491,000 Trade RETAIL: The dollar volume of sales at thirty-one reporting department stores in leading cities of the District declined by about the usual seasonal amount during July but was 5.5 per cent greater than in July, 1935. This was the second smallest increase in department store sales this year over the corresponding month of last year and reflected in part the intensely hot weather which has restricted retail distribution. Sales for the first seven months of 1936 increased 9.2 per cent compared to sales for the first seven months of 1935. Stocks of merchandise continued to decline between June 30 and July 31 but at the close of July were 8.4 per cent greater than a year ago. Collections on regular thirty-day accounts during July averaged 4-5.1 per cent of amounts receivable at the close of the preceding month compared to a ratio of 46.7 per Stores Reporting Dry goods...................... 5 Groceries ............ ·-··········· 5 Hardware·--····················· 8 Furnitur...____ 3 Drugs .....·-··-·····-············· 7 +11.3 cent in June and 43.9 per cent in July of last year. Collections on installment accounts averaged 14.2 per cent in July, 16.1 per cent in June, and 14.I per cent in July, 1935. WHOLESALE: The combined dollar volume of five representative lines reporting to this bank increased 2.2 per cent from June to July. This increase was somewhat smaller than that from June to July last year but was in contrast to declines for the month in the preceding five years. The combined sales volume during July was 9.6 per cent greater than a year ago and during the first seven months of 1936 showed an increase of 10.4 per cent over sales in the first seven months of 1935. By individual lines, sales of dry goods increased 5.6, groceries 7.4, hardware 15.6, furniture 17.7, and drugs 10.4 per cent for the seven-month period. Stocks of merchandise increased 3.2 per cen t between _Tune 30 and July 31 but were I.I per cent smaller tha:i on July 31, 1935. Stocks of dry goods, furniture, and drugs were larger than one month earlier, while stocks of groceries and hardware were smaller. All lines except groceries reported an increase in stocks for the year. Lumber Sales of lumber in board feet at I 58 reporting retail yards in the District, following two months of dec1ines, increased during July and were slightly larger than a year ago. The dollar volume of sales of all materials, however, continued to decline although showing a considerable increase compared to July, 1935. Sales in board feet for the seven months increased 36.6 per cent compared to sales for the same period in 1935. Stocks and outstandings on July 31 were smaller than one month earlier but continued wel1 above a year ago. Collections improved during July, averaging 46.4 per cent of amounts outstanding at the end of the preceding month compared to a ratio of 43.5 per cent in June and of 43.9 per cent in July of last year. July business at the I 58 reporting yards, in percentages of increase or decrease: Sales of lumber, board feet ............................... . Sales of all materials, dollars ........................... . Stocks of lumber, board feet ............................. . Outstandings, dollars .................... _ __ _ WHOLESALE TRADE IN THE TENTH FEDERAL RESERVE DISTRICT In Percentages of Increase or Decrease SALES 0UTSTANDINGS .AMOUNTS COLLECTED July 1936 July 31, 1936 July 1936 compared to compared to compared to June 1936 July 1935 June 30, 1936 July 31, 1935 June 1936 July 1935 + I.2 - 0.4 + 2.4 +n.7 + 5.7 + 4.7 +26.3 +21.9 +u.o - 3.2 + 3.1 +18.7 - 17.6 + 1.7 - 6.4 + 8.3 + 3.0 +26.5 -38.'2 +17.0 -20.1 +23.8 - 9.6 +21.4 - 2.4 + 1.5 - 4.6 - 1.5 + 2.5 + 6.4 July 1936 compared to June 19.36 July 1935 +u.7 + 2.7 - 3.2 +14.6 - 1.7 +16.1 - 4.2 +18.4 STOCKS July 31, 1936 compared to June 30, 1936 July 31, 1935 +u.o + 1.6 - 5.6 -13.5 - 0.5 + 2.3 +14.1 + 4.5 + 4.1 +10.8 THE MONTHLY REVIEW 4 Building The total value of construction contracts awarded in the Tenth District during July, according to statistics of the F. W. Dodge Corporation, was 8.6 per cent larger than in June and about three times the value of awards a year ago, representing 94 per cent of the July average during the past ten years. Residential awards were smaller than in June and slightly larger than a year ago. Total awards for the first seven months of this year increased 76.9 and residential awards 66 per cent compared to the same period in 1935. The value of construction contracts awarded, as reported by the F. W. Dodge Corporation: July 1936...... June 1936._. July 1935...... 7 Mos. 1936.. 7 Mos. 1935_ RESIDENTIAL Tenth District United States t, 2,269,500 t, 72,093,700 2,813,6o3 73,604,600 2,138,1 II 48,371,800 15,660,671 406,988,300 9,431,540 256,621,100 TOTAL Tenth District United States t,13,082,000 $ 294,834,500 12,048,736 233,054,600 4,372,238 I 59,249,900 72,488,404 1,524,637,400 40,977,652 856,159,200 Building permits in eighteen cities in the District declined in number but increased 26.3 per cent in value from June to July. The number of permits issued during July was the largest for that month since 1930 and estimated expenditures were the largest for any month in a year but 5.1 per cent below the total for July> 1935. During the first seven months of 1936, permits increased 14.4 per cent in number and 63.2 per cent in value compared to the first seven months of 1935. BUILDING PERMITS IN TENTH DISTRICT CITIES PERMITS ESTIMATED COST 1935 1936 1935 1936 66 t, 11 3,3°5 f, 69 Albuquerque, N. M.·--··············· 91,976 Cheyenne, Wyo ........................... 129,130 25 42,37° 55 Colorado Springs, Colo.·--········· 32 46,844 52 3 1,470 Denver, Colo............................... 420,214 420 706,878 347 Hutchinson, Kans ....................... 34,693 135 55,77 1 55 Joplin, Mo ................................... 18 18,250 32 50,300 Kansas City, Kans ..................... 1,704,238 36 69,985 43 Kansas City, Mo .... 218 231 407,100 609,400 Lincoln, Nebr..- .. 128 124,687 259,262 143 Oklahoma City, Okla................. 263,010 1,300,422 209 154 Omaha, Nebr. II8 323,100 123 137,352 Pueblo, Colo. 10,294 23,583 47 37 Salina, Kans 21 27,610 14 7,510 Shawnee, Okla... 12 IO 3,800 9,3 25 St. Joseph, Mo 22,360 41 27 23,847 Topeka, Kans n6,700 69 83,655 55 Tulsa, Okla..___ 107 171,986 117 2o6,505 159 11 9,576 167,370 Wichita, Kans ..............·-············ 190 Total 18 cities, July Seven months.... 1,850 1,765 II,957 10,456 f, 3,863,892 f, 4,069,986 22 ,3o6,949 13,671,187 Flour Milling Flour milling operations in the District were increased from 59.1 per cent of full-time capacity in June to 69.5 per cent in July, and production increased 22 per cent, somewhat more than the usual seasonal amount. July production exceeded the average for the month during the past ten years by 8.7 per cent and was 22.4 per cent larger than a year ago when milling time averaged 56.5 per cent of capacity. Production for the first seven months of 1936, however, was only slightly above that for the first seven months of 1935, owing to decreases recorded earlier in the year. Advancing prices in the wheat market resulted in a substantial volume of flour sales in the southwest during July. The new business during the initial month ·of the new crop season consisted chiefly in numerous small and medium-sized orders for nearby shipment, but several large round lot sales were made in the closing week of the month, increasing the sales volume for that week to 199 per cent of capacity. Shipping directions improved in July and were ample to keep mills running at a good rate. Flour prices at the Kansas City market showed little change during the first three weeks of July, while millfeed prices, after advancing in the forepart of the month, declined as offerings met consumer resistance to higher prices and as offerings became heavier with increased running time at mills. In the final week of the month, both flour and millfeed prices advanced sharply to close the month above opening quotations. Flour production at the principal milling centers in the District, as estimated from the weekly reports of southwestern mills to the Northwestern Miller: Atchison.............. .......................... Kansas Ci tY·---··························· Salina........ _ _ __ Wichita. ___. _ _ _ _ _ __ Outside.......................................... July 1936 Barrels 149,778 505,734 211,379 215,866 1,155,666 June 1936 Barrels 12o,473 502,564 172,453 153,743 885,999 July 1935 Barrels 104,855 487,748 138,271 171,511 927,006 Tota~----2,238,423 1,835,232 1,829,391 •United States____ 6,156,775 5,069,608 4,852,6oo •Represents about 6o per cent of the total output in the United States. Grain Marketing The movement of wheat to the five principal markets in the District during the initial month of the new crop year was the largest since 1931 and exceeded the average for July during the past ten years by 1 I. 1 per cent. The movement of the new crop to market has been rapid, owing to favorable weather for harvesting and threshing and to favorable prices, and reports indicated that the peak of the seasonal movement had been reached in the latter part of July, in contrast to last year when the peak occurred in August. The 1936 crop was reported to be of high average quality. Receipts of corn, although substantially larger than a year ago, were one-third smaller than in June, reflecting the tendency of growers to withhold supplies because of uncertainty regarding the new crop, and were 23.7 per cent below the July ten-year average. Marketings of oats and barley were sharply above and of rye and kafir only slightly below the average volume. Receipts of grain at the five markets: Hutchinson ...... Kansas City._. Omaha ...·- ········ St. Joseph._ ___. Wichita.--······· Wheat Corn Oats Bushels Bushels Bushels 1,250 6,917,400 30,257,600 1,633,500 620,000 12,573,627 1,178,800 1,680,000 216,000 484,000 5,180,800 42,000 3,900 5,74°,500 July 19.36.......... June 1936·--····· July 1935........_ 7 Mos. 1936...... 7 Mos. 1935...... 60,669,927 14,052,533 25,345,483 92,735,137 43,684,189 Rye Bushels Barley Bushels 13,500 43,400 6,000 1,300 120,000 152,000 Kafir Bushels 22,100 n6,200 14,000 7,800 - - - - - - - - - --- 3,033,450 4,576,750 1,246,950 25,825,618 16,432,010 2,826,000 1,164,500 519,000 9,147,500 3,665,500 64,200 286,000 58,200 198,000 28,100 12,800 415,400 1,685,750 120,900 93,450 146,100 165,300 88,900 875,200 446,500 With continued hot, dry weather and further deterioration in growing crops, particularly corn, cash grain prices at the Kansas City market advanced sharply during July, continuing the upward trend begun early in June, and further advances were recorded early in August. Cash grain quotations on July 31 were well above the levels prevailing on that date in recent years, with wheat futures at the highest level since July, 1933, and corn futures at the highest level since September, 1929. Cash grain prices at Kansas City: No. 1 hard, dk. wheat, bu. No. 2 mixed corn, bu ... .. No. 2 white oats, bu ....... No. 2 rye, bu·----·-·-··No. 2 barley, bu .. _ . _ No. 2 white kafir, cwt.._ Aug. 15 July 31 June 30 Aug. 15 July 31 July 31 1935 1934 1936 1936 1936 1935 t,1.20½ t,1. 16½ t, .94½ t, .97½ f,1.03 $1.02 1,12½ 1.09½ ,86½ .65½ .81½ .70¾ .34,½ .45 .32 .29½ .47½ -47½ .51 .84½ .87 .59 •49 •94 .go .68 .84 ·52 .47 ◄9 1.64 1.23 1.08 I.JO 1.89 1.39 THE MONTHLY REVIEW Crops Crop prospects in the District declined materially during July and the forepart of August with a continuation of drought conditions which had prevailed generally since the middle of June. Local rains in limited areas in the latter part of July and early in August were of some benefit but were generally too light to alter materially the prospects of growing crops, although the moisture and accompanying moderation in the excessively high summer temperatures temporarily halted the rapid decline in condition in these areas. Damage from grasshoppers and other insect pests has been heavy. Plowing for fall seeding of wheat has proceeded slowly because of the dry soil. Official estimates of the Department of Agriculture indicated that the production of winter wheat in the seven states, all or parts of which are included in the Tenth District, declined about 3 per cent between July 1 and August r, spring wheat 21 per cent, corn 73 per cent, oats 12 per cent, barley 22 per cent, tame hay 9 per cent, wild hay 16 per cent, white potatoes 11 per cent, and sweet potatoes 9 per cent. Grain sorghums, broomcorn, pastures, and cotton also suffered extensively. On the basis of the August 1 estimates, the production of winter wheat and sugar beets will be above that in 1935 but other crops will be smaller than last year and practically every crop will be much below the average for the five years 1928 to 1932. The indicated yield per acre of thirty-two important crops combined, expressed as a percentage of the ten-year, 1921 to 1930, average yield was as follows: Nebraska, 42; Kansas, 62; Oklahoma, 63; Missouri, 59; Wyoming, 72; Colorado, 78; New Mexico, I08; and the United States, 84.5 per cent. Crop production in the Tenth District proper except as otherwise indicated and in the United States, as estimated by the Department of Agriculture on August 1, in thousands of units: TENTH DuT.RICT UNITED STATES Forecast Production Forecast Production Aug. 1, 1936 1935 Aug. 1, 1936 1935 Winter wheat, bu.·----······· 205,945 141,955 519,097 464,203 Spring wheat, bu................. 6,696 8,915 n3,648 I 59,241 All wheat, bu ..·-·········-·· 212,641 150,870 632,745 623,444 Corn, bu ... .. _ _ _ _ _ 70,861 200,468 1,439,135 2,:291,629 Oats, b u _ _ _ _ _ _ 77,688 161,035 771,703 1,196,668 Tame hay, ton....____ 6,545 8,578 61,853 76,146 White potatoes, bu............. 23,510 36,742 294,537 387,678 Cotton, bales........................ 386 471 12,481 10,638 Tobacco, lbs ...·-··················· 2,658 2,865 1,106,801 1,296,810 •Grain sorghums, bu.·-······· 26,882 31,674 8I,588 97,823 •Broomcorn, tons................ 23 34 41 63 *Sugar beets, short tons·--· 3,466 2,976 8,808 7,908 *Dry beans, 100 lb. bags._. 1,736 2,093 10,200 13,799 *Apples, bu.·---·················3,2# 8,910 102,487 167,283 *Peaches, bu.·--··················· 1,350 3,639 43,131 52,808 *Pears, bu.·-···········- ············ 414 1,365 23,519 22,035 *Grapes, ton.,_____ 10 20 1,831 2,455 *Totals for the seven states whose areas or parts thereof comprise the Tenth District. The winter wheat crop was harvested under favorable conditions but the extreme temperatures of late June and early 5 July injured some late wheat, effecting a slight downward revision in production during July. The corn crop is practically a failure so far as grain production is concerned and reports indicated that most of the acreage not abandoned would be utilized for forage, grazing, and silage. The first cutting of alfalfa ranged from fair to good but later cuttings are expected to be very light because of the dry weather. Early planted grain sorghums withstood the drought fairly well but both early and late grain sorghums have declined rapidly since August 1. The total production of the four feed grains, corn, oats, barley, and grain sorghums, in the United States was estimated by the Department of Agriculture as 42 per cent below the 19231932 average, indicating the necessity for an extensive readjustment in the numbers of grain-consuming live stock, particularly hogs, and a reduction in the grain ration of live stock wintered. The feed situation, however, was somewhat less serious than in 1934, since the available supply of feed grains was expected to be about 5 per cent and hay supplies about 20 per cent greater than two years ago, while the number of grain-consuming units of live stock and poultry on farms on August 1 was about 3 per cent and the number of hay-consuming animals 9 per cent less than in 1934. Pastures in this District were short and farmers were using feed normally reserved for late fall and winter feeding. The production of sugar beets, dry beans, and commercial truck crops in irrigated areas in the District was reported good but dry land crops were poor. The late potato crop in Nebraska and Wyoming was in a critical condition on August 1 while prospects were for about an average crop in Colorado and New Mexico. The prospective yield of standard broomcorn in Oklahoma was much better than that of dwarf but was greatly reduced below the average. The broomcorn acreage was somewhat smaller than that of last year. The outlook for fruit was extremely unfavorable except in Colorado and New Mexico principally because of freezing temperatures in April. Drought had seriously curtailed the prospective yield of cotton in Oklahoma, while prospects were good in the irrigated sections of New Mexico and a record yield per acre was forecast for Missouri. The acreage in cotton was increased 6 per cent in Oklahoma, 18 per cent in New Mexico, and 14 per cent in Missouri this year. Cotton production on August 1 this year and last was estimated as follows: Oklahoma, 465,000 and 567,000 bales; New Mexico, 101,000 and 75,000 bales; and Missouri, 287,000 and 177,000 bales. Live Stock MARKETINGS: The movement of live stock to the- six principal markets in the District, including direct shipment; of hogs to packers, increased during July and was heavier than a year ago with the exception of sheep. July receipts of cattle and calves were 2.7 per cent and 4.9 per cent, respectively, above the average for the month during the past ten years, but JULY MOVEMENT OF LIVE STOCK IN THE TENTH DISTRICT R£CEIP'fS Kansas CitY··- ····-···· Omaha _ _ _ __ St. Joseph .........·-······ Denver. _ _ __ Oklahoma CitY-·····Wichita .. _.................. Cattle uo,800 149,393 33,795 26,094 4o,551 20,764 Calves 24,667 14,819 7,147 3,476 J2,II8 5,321 Hogs *162,226 172,646 62,639 35,377 24,8o6 20,515 STOCKERS AND FEEDERS Sheep 69,824 129,542 6o,6o8 240,6u 15,331 8,415 Cattle 25,578 28,697 3,394 6,479 Calves 3,86o 2,474 574 657 Hogs 3,862 2,352 1,057 192 PURCHASED FO.R SLAUGHTER Sheep 9,690 23,349 4,600 32 ,7°9 Cattle 64,077 83,687 25,826 14,527 26,557 10,005 64,148 July 1936 478,209 7,463 70,348 224,679 67,548 524,331 7,565 381,397 38,281 197,054 5,581 52,632 418,045 315,619 437,930 53,904 June 1936·---···5,945 5,110 273,028 571,801 36,468 July 193 54,146 184,554 298,797 5,94 2 46,959 Seven months 1936_ 2,301,612 1,373,8o7 378,222 46,510 32,698 372,913 385,972 3,086,649 3,867,349 tSev:en months 1935 2,170,786 418,951 2,458,570 4,089,640 422,543 74,971 42,745 294,758 1,168,057 tReceipts include Government purchases of cattle and calves. •Includes 108,907 hogs shipped direct to packers' yards. Calves 21,244 12,282 6,423 2,572 9,951 4,734 Hogs *148,492 136,539 Sheep 53,301 55,448 96,365 55,529 24,081 20,403 17,890 27,271 12,662 7,891 255,166 400,706 57,206 366,86o 44,461 247,931 212,708 295,256 46,273 313,686 2,599, 140 2,068,808 323,261 2,020,405 2,265,286 6 THE MONTHLY REVTEW receipts of sheep were 2.2 per cent and hogs 35.6 per cent below the average volume. Marketings for the first seven months of 1936 showed an increase in the number of cattle and hogs and a decrease in the number of calves and sheep compared to marketings during the first seven months of last year. The six markets received 5,2.55 head of horses and mules in July, as compared to 3,672 head in June, and 8,593 head in July, 1935. PRICES: Live stock values at the Ka?\sas City market during July showed the effects of the drought which increased the premium on finished offerings and lowered the values of medium and plainer grades of animals which constituted the bulk of market supplies. Prices of best quality butcher hogs advanced 10 to 35 cents per hundredweight, but medium grades were down as much as '1,1 and prices of stock pigs declined $1.50 to $2.00. Hogs reached a top of 'l,10.85 on July 29, the highest level since last September and the highest price for any July since 1929, and advanced further to 'l,11.55 on August 18. Prices of choice fed native beef cattle advanced about 25 cents during July but stockers and feeders and most other classes declined about 50 to 75 cents. The cattle top of 'l,9.15 was the highest since April but was well below the top of 'l,12.00 a year ago. Cattle values reached $9. 50 on August 24. Prices of new crop lambs advanced 25 to 35 cents in July and at the month's top sold at 'l,10.6o, the highest level for the month since 1930. Lamb prices declined seasonally the forepart of August. STOCKERS AND FEEDERS: The countryward movement of stocker and feeder live stock from four markets in the District was considerably heavier in July than in June or in July of last year. Shipments of cattle and calves were 8.4 per cent and 26.9 per cent above the average volume during the past ten years, but shipments of hogs were 10.7 per cent and sheep 12.5 per cent below the average volume. During the first seven months of the year, however, sheep was the only species to show an increase, shipments of cattle declining 10.5, calves 38, and hogs 23.5 per cent compared to shipments for the first seven months of 1935. The Department of Agriculture estimated that the number of cattle on feed for market in the eleven Corn Belt states on August 1 was 2.8 per cent larger than a year ago, owing to increases in the number on feed east of the Mississippi River. The number on feed in Missouri was 5 per cent, in Nebraska I 5 per cent, and in Kansas 30 per cent below the number on feed August 1 of last year. According to the survey of anticipated purchases the last five months of the year, feeders in the Corn Belt expected to purchase a much smaller number of cattle than last year. In states west of the Missouri River, where the drought has most seriously affected grain production, the decrease exceeded 30 per cent. Estimates of the Department of Agriculture indicated that the 1936 lamb crop in the United States was about 9 per cent larger than the 1935 crop, 2.5 per cent larger than the 1934 crop, and less than I per cent smaller than the record crop of 1931. The increase over last year's crop occurred in the western sheep states as the native lamb crop was slightly smaller than last year. In the western sheep states, Wyoming recorded an increase of 1 2 per cent and Colorado and New Mexico increases of 15 per cent. In the native sheep states of Missouri and Kansas there were decreases of 3 per cent, but in Nebraska the lamb crop increased 9 per cent. RANGES AND PASTURES: Range and pasture feed on August 1 was very poor and short in northeastern Wyoming, in Oklahoma, and in much of eastern Nebraska and Kansas but continued good in mountain are~s in the District and in the Sand Hills area of Nebraska. Ranges in western Nebraska declined 18, western Kansas 15, Qklahoma 19, Colorado 9, and New Mexico 7 condition points during July. In Wyoming, however, there was a recovery of 6 points following rains in the latter part of the month, and range feed was fair to good in the western part of the state. Recent rains improved feed prospects in eastern Colorado and in western ebraska. Cattle and sheep were generally in good condition on August I except in drought areas and were reported in better condition in drought areas than at that time in 1934. Shipments of cattle have been heavy from northeastern Wyoming and some cattle have been moved from Nebraska, Kansas, and Oklahoma because of short feed . The Flint Hills pastures of Kansas were reported dry and short of water. WOOL: Preliminary estimates of the Department of Agriculture indicated that the amount of wool shorn or to be shorn in 1936 in the seven states in this District would be slightly smaller than in 1935. There was a general decline in the number of sheep shorn and in all states except Colorado and New Mexico fleece weights averaged the same or less than a year ago. Wool production and the number of sheep shorn, estimated by the Department of Agriculture: Colorado ............ Kansas .............. Missouri ............ Nebraska .......... New Mexico...... Oklahoma.. ....- ... Wyoming.......... Seven states...... United States.... SHEEP SHOR Thousand Head 1935 1936 1934 1,661 1 ,527 1,493 464 53 1 5°5 1,200 1,242 1,285 362 400 400 2,520 2,290 2,1 76 160 220 185 3,120 3,496 3, 174 WooL PRODUCTION Thousand Pounds 1 935 1934 1936 12,216 13,122 12,541 3,586 3,962 3,4 19 8,170 8,869 8,196 3,029 2,730 3,040 15,45° 16,030 17,136 1,870 1,296 1,424 33,212 29,640 30,153 73,85 1 361,265 76,129 364,663 79,III 37o,3~9 9,164 45,480 9,384 45,497 9,863 46,665 Meat Packing Meat packing operations in the District, as reflected by packers' purchases at the six principal live stock markets in the District, direct shipments of hogs included, were somewhat heavier in July than in June, with the slaughter of cattle, calves, and hogs considerably larger than a year ago, although hog slaughter was 30.5 per cent below the ten-year average for July. Cattle and calf slaughter exceeded the average by 4.7 and 14.6 per cent, respectively, while sheep slaughter fell 22 per cent below the average and 13.6 per cent below the total in July, 1935. During the first seven months of this year, purchases of cattle and hogs increased and purchases of calves and sheep decreased compared to purchases in the same period of last year. The Department of Agriculture report on Federally inspected slaughter in the United States showed a slight decline in hog slaughter during July but increases for other species. The slaughter of cattle and calves was at a high level, exceeding the average for the month during the past ten years by 2.6.9 and 32..4 per cent, respectively. Sheep slaughter, although smaller than a year ago, was 4.7 per cent above the average, while hog slaughter was 12..7 per cent below the average despite a substantial increase compared to the low level of slaughter of 1935. Live stock slaughtered under Federal meat inspection in the United States, reported by the Bureau of Agricultural Economics from compilations of the Bureau of Animal Industry: . Cattle Calves Hog-s Ju ly 1936...................... 927,536 523,363 2,691,815 Ju11e·1936. __ ················· 853,188 516,637 2,739,u6 July 1935...................... 744,900 464,091 1,712,312 Seven months 1936._... 5,789,219 3,420,301 18,933,256 Seven months 1935·-··· 4,974,077 3,257,262 15,505,091 NOTE: Slaughter for Government relief purposes excluded. Sheep 1,352,468 1,308,721 1,545,804 9,368,746 9,889,700 THE MONTHLY REVIEW Petroleum The daily average flow of crude oil in the five oil producing states in the District declined slightly from June to July, but gross production, with one more producing day, increased I 1.7 per cent. Production was 3 per cent greater than in July, 1935, and was 3.6 per cent above the ten-year average. During the first seven months of 1936, production increased 7.5 per cent compared to production for the first seYen months of 1935. Gross production, estimated from the weekly reports of the American Petroleum Institute for July, 1936, and officially reported by the Bureau of Mines for June, 1936, and July, 1935: Oklahoma.-.................................. . Kansas ......................................... . Wyoming..................................... . Colorado.__ .................................. . New Mexico.---··························· July 1936 Barrels 16,858,000 4,759,000 1,173,000 142,000 2,294,000 June 1936 Barrels 16,895,000 1,143,000 147,000 2,189,000 July 1935 Barrels 16,435,000 4,865,ooo 1,274,000 124,000 1,804,000 Total five states................ ......... Total United States.................... 25,226,000 91,466,000 24,933,000 90,185,000 24,502,000 85,485,000 4,559,ooo Mid-continent crude oil prices were unchanged during July at posted schedules ranging from 86 cents to $1.18 per barrel according to gravity. Field operations continued active, with a substantial increase in the number of completions and in new production. Field operations in the District, reported by the Oil and Gas Journal: Wells Completed Oklahoma... _............. 300 Kansas...................... 177 Wyoming.................. 10 Colorado.--··············· o New Mexico·--········· 63 July 1936.................. June 1936._.............. . July 1935-................ . Barrels Daily New Production 195,445 99,9 1 3 5,0 97 Dry Wells 56 44 2 0 0 59,086 0 Gas Rigs-Wells Wells Drilling 13 596 6 339 66 0 37 0 124 55° 359,541 259,070 10'2 106 20 426 302 I 58,350 95 18 IO 1,162 1,286 1,076 Zinc and Lead Shipments of zinc ore from Tri-State mines and tailing mills continued to decline during the five weeks ended August 1 and for the first time since February were below shipments for the corresponding period of 1935. Deliveries of lead ore, for which there was a brisk demand, increased further during the five weeks and were above a year ago. Shipments of both lead and zinc exceeded production for the five-week period, and at the close of July there were 42 zinc mills in operation as compared to 64 at the middle of June, reflecting the effort of producers to curtail output and reduce surplus stocks. Cumulative shipments for the first thirty-one weeks of 1936 increased 28.4 per cent for zinc and 46.2 per cent for lead compared to shipments during the first thirty-one weeks of 1935. 7 The tonnage and value of zinc ore and lead ore shipments from the Tri-State district: ZINC Ou Tons Value 15,756 '/, 485,158 10,978 338,613 3,456 106,864 Tons Value 4,352 f, 217,600 1,748 87,400 270 13,500 30,190 '$ 930,635 37,130 1,188,160 34,005 952,140 31 Weeks ended Aug. 1, 1936...... 251,230 8,002,315 31 Weeks ended Aug. 3, 1935·-··· 195,596 5,180,105 6,370 f, 318,500 4,520 226,000 5,347 222,021 31,559 1,555,550 21,591 789,253 Oklahoma.......................................... Kansas .. _.......................................... 1'1issouri............................................ LEAD ORE 5 Weeks ended Aug. 1, 1936.- ... 5 Weeks ended June 27, 1936.-... 5 Weeks ended Aug. 3, 1935·-··· Prices of zinc ore at the Joplin market, after remaining unchanged at $32 per ton since last October, declined $1.50 early in July with a decline in slab zinc quotations but later advanced 50 cents to close the month at $31 per ton as compared to $28 a year ago. Lead prices were unchanged during July at $50 per ton compared to $43 at the close of July last year. Coal The production of bituminous coal in the District increased somewhat more than seasonally during July and was 25.3 per cent greater than in July, 1935. Production for the first seven months of the year increased 17 per cent compared to production for the first seven months of last year. Bituminous coal production reported by the Bureau of Mines: Colorado._ ..................................... Kansas and Missouri ................. . N cw Mexico -······························· Oklahoma ..·- -······························· Wyoming ..................................... . *July 1936 Tons 322,000 409,000 118,000 8,8,ooo June 1936 Tons 355,000 314,000 305,000 341,000 109,000 56,000 July 1935 Tons 266,000 292,000 92,000 61,000 320,000 Six states...................................... 1,292,000 1,125,000 1,031,000 United States................................ 32,113,000 29,300,000 22,339,000 *Estimated from the weekly reports of the United States Bureau of Mines. Cold Storage Holdings United States cold storage stocks of beef, miscellaneous meats, lard, eggs, butter, and cheese increased seasonally during July, with stocks of pork, lamb, and poultry increasing contrary to seasonal trends. Holdings of miscellaneous meats, lard, and cased eggs, which were below normal on July 1, were increased by somewhat more than the usual seasonal rate during July, while holdings of cheese, which were above normal, were increased by less than the usual seasonal amount. Holdings of pork, poultry, miscellaneous meats, lard, and cheese on August 1 were larger than a year ago but holdings of beef, lamb, eggs, and butter had declined during the year. Storage stocks of poultry were 25.9 and cheese 3.5 per cent above the August I five-year average, while stocks of beef were 2.9, pork 30.4, lamb 9.6, miscellaneous meats 5, lard 21.1, cased eggs 13.4, and butter 18.5 per cent below the average. National Summary of Business Conditions By the Board of Governors of the Federal Reserve System Production, employment, and trade increased further in July, when allowance is made for the usual seasonal changes, and commodity prices continued to advance. Money rates rem ained at extremely low levels. PROD CTIO A D EMPLOYME T: Industrial produ ction, which usually declines considerably in July, was maint ained at the level of the preceding three months, and the Board's seasonally adjusted index advanced to 108 per cent of the 1923-1925 average as compared with 103 per cent in June. Output of steel continued at about the June rate, although a sharp decrease is usual, and automobile production declined by less than the usual amount. In the first three weeks of August there was little change in activity at steel mills, while at automobile factories output was curtailed as preparations were made for the production of 1937 models. Output of nondurable products was larger in July than in June, reflecting chiefly a sharp rise in activity at cotton mills and greater than seasonal increases in production at shoe factories, silk mills, and flour mills. At coal min.es output increased and crude petroleum continued to be produced in large volume. Factory employment increased further in July, contr:uy to seasonal tendency. The number of workers was larger than in June at steel mills, foundry and machine shops, and furniture factories, while at railroad repair shops there was a decline. 8 THE MONTHLY REVIEW Among the nondurable goods industries employment increased at textile mills and meat packing plants, and declined less than seasonally at establishments producing wearing apparel. Factory payrolls decreased by a smaller amount than is usual in July. The value of construction contracts awarded increased considerably from June to July, according to the F. W. Dodge Corporation, with large increases reported for both publiclyfinanced and privately-financed 'York. PER CENT f;~cE;:.:..:N..:...T_~- ~-,N-D_U_S~T-R-IA-L---.-P_R_O_D..,..U_C_T_I_O..,..N---,-------, 140 prices also advanced while cotton declined. There was a considerable increase in the price of steel scrap. BANK CREDIT: Excess reserves of member banks decreased from $2,920,000,000 on July 15 to $1,810,000,000 on August 19. About $1,470,000,000 of excess reserves were absorbed by the increase of 50 per cent in reserve requirements of member banks, which went into effect August 15. This decrease was offset in part by a growth of $360,000,000 in total reserve PER CENT PER CENT 250 130 1----i---~--+---1----+---+-----+-----i 130 120 250 DEPARTMENT STORE SALES 200 200 150 150 100 100 tto 100 90 80 70 _ 50 1,.....,..,--'----'----'-----'---'----"---~-..-vv,, 50 1936 1929 1930 1931 1932 1933 1934 19~5 Index of physical volume of production, adjusted for seasonal variation, 1923-1925 average=100. By months, January 1929 through July 1936. AGRICULTURE: Crop prospects declined during July as a result of continued drought. On the basis of August 1 conditions, the corn crop was estimated by the Department of Agriculture at 1,439,000,000 bushels, a reduction of 37 per cent from last season, and estimates for spring wheat, oats, hay, and potatoes were also considerably under the harvests of a year ago. The cotton crop was forecast at 12,481,000 bales as compared with 10,638,000 bales last year and an average of 14,667,000 bales during the five years 1928-1932. DISTRIBUTIO : Retail trade was sustained in July at a higher level than is usual in that month. The Board's adjusted index of department store sales, which allows for a considerable PER CENT PER CENT 120 120 FACTORY EMPLOYMENT I 50 50 60 1 - - - - i - -- ~ - - + -4r-.l-+--W---+---+----+-----t 60 AdJusted for seosonol variation WilhOtJI seasonal adjustment 0 0 1930 1929 1931 1932 1933 1934 1935 Indexes of value of sales, 1923-1925 average-100. January 1929 through July 1936. 1936 By months, balances, reflecting principally large disbursements by the Treasury from its funds held on deposit with Federal Reserve banks. After the increase in reserve requirements there remained a large amount of excess reserves widely distributed among member banks. The money market was not affected by the action, and interest rates remained at extremely low levels. In the week ending August 19 a few scattered banks borrowed at the reserve banks, but the total amount borrowed was negligible and some banks drew upon their balances with other banks in order to meet the increase in requirements. Deposits of domestic banks with reporting member banks in leading cities declined by $210,000,000 in the week. BILLIONS OF DOLLARS BILLIONS OF DOLLARS 8 MEMBER BANK RESERVE BALANCES 8 110 7 7 too 100 6 6 90 90 5 5 4 80 4 80 3 3 70 70 2 2 110 60 1.........--l------'-----...l..---~-.:.......I.-- - ' - - - - - ' - - - - ' 50 1929 1930 1931 1932 1933 1934 1935 1936 In<lex of number employed, adjusted for seasonal variation, 1923- 0 0 1932 1933 1934 1935 1936 1925 average=100. By months, January 1929 through July 1936. Wednesday figures of total member bank reserve balances at Federal Reserve banks, with estimates of required and excess reserves, January 6, 1932, through August 19, 1936. seasonal decline, increased from 88 per cent of the 1923-25 average in June to 91 per cent in July and mail order and variety store sales also showed smaller decreases than are usual for the season. Freight-car loadings increased in July. COMMODITY PRICES: Wholesale commodity prices continued to advance between the middle of July and the middle of August. Prices of wheat, fl.our, feed grains, and dairy products rose considerably, owing primarily to the drought, and live stock Between July l 5 and August 19 loans and investments of reporting member banks in leading cities declined by $260,000,000 reflecting reductions of $130,000,000 in loans on securities and of $160,000,000 in holdings of United States Government direct obligations, partly offset by an increase of $60,000,000 in other loans to customers. Adjusted demand deposits, which increased to a new high level on July 22, were slightly smaller on August 19.
@FedFRASER